The Chevrolet Volt was one of the most revolutionary electric vehicles (EV) in the market, combining an all-electric powertrain with a gasoline engine as a range extender. The federal government encouraged EV adoption by offering tax credits to potential buyers, and this article will be your guide on how these credits work specifically for the Chevy Volt.

The Federal Tax Credit

The federal government offered a tax credit of up to $7,500 for eligible Chevrolet Volt buyers in an effort to incentivize electric and plug-in hybrid vehicle ownership. The amount of the tax credit was determined based on battery capacity, with the Chevy Volt’s 18.4-kilowatt-hour lithium-ion battery making it eligible for the full $7,500 credit.

It is vital to know that this tax credit was not a rebate or discount on the vehicle’s purchase price. Instead, it is received as a credit on your federal income tax liability. Consequently, if your tax liability is lower than the credit amount, you may not receive the full amount in practice.

Phasing Out of Tax Credits

In December 2018, General Motors (GM) reached a milestone of selling 200,000 qualified electric vehicles in the United States. As a result, the IRS began phasing out the tax credits for GM vehicles starting April 1st, 2019. The timeline of phase-out period breaks down as follows:

1. April 1st – September 30th, 2019: The full tax credit of $7,500 was available.
2. October 1st, 2019 – March 31st, 2020: The credit was reduced by half to $3,750.
3. April 1st – September 30th, 2020: The credit was further reduced to $1,875.
4. On October 1st, 2020, the federal tax credit for Chevrolet Volts officially ended.

State and Local Incentives

Even though the Chevy Volt is no longer eligible for the federal tax credit, you may still be eligible for state or local incentives. Some states offer additional tax credits, rebates, or other benefits for EV owners, such as reduced registration fees and access to carpool lanes.

It is essential to research incentives available in your area and consult with a tax professional for guidance on how they can work alongside the federal credit.

In conclusion, it is crucial to be aware of the availability of tax credits when considering purchasing an electric or plug-in hybrid vehicle like the Chevy Volt. Although the federal tax credit has phased out for Chevrolet Volts, state and local incentives may still provide additional savings. Therefore, always explore various incentives before making a decision.